Number of major bankruptcies growing sharply

The weak economy might Pursue and ensures more Insolvencies the first three quarters of 2024, the number of corporate insolvencies is expected to rise by around a quarter (24.6 percent) to 4,895 bankruptcies, according to a projection by the credit protection association KSV1870.

The Major bankruptcies are increasing: The number of insolvencies with liabilities of more than 10 million euros doubled from 27 to 55 year on year. Personal bankruptcies easy to.

Due to various Signa bankruptcies, the number of major bankruptcies with liabilities of more than EUR 10 million doubled from 27 to 55. The largest new bankruptcy, however, is that of the Austrian subsidiary of the US electric vehicle manufacturer Fisker, with liabilities of EUR 3.79 billion.

The many large-scale insolvencies also ensure that liabilities have shot up to a total of 14.8 billion euros in the first three quarters of this year, an increase of 683 percent compared to the same period last year.

In addition to the increasing number of bankruptcies, the number of insolvencies not opened due to a lack of assets is also noteworthy. More than a third (37 percent) of all insolvencies are not opened due to a lack of assets – this means that the company cannot even raise 4,000 euros to cover the legal costs. In such a case, the creditors would usually come away completely empty-handed.

Looking at the sectors, companies in the retail sector (853 bankruptcies) are most affected by insolvency this year, followed by the construction industry (814) and the catering industry (596). “These three sectors set the tone in a negative sense and are responsible for almost half of all corporate bankruptcies in Austria,” writes KSV1870.

Increase in personal bankruptcies

The creditors’ protection association also expects an increase in private bankruptcies – according to projections, there will be 6,694 debt settlement proceedings from January to the end of September this year. That corresponds to 24 cases per day and is 0.7 percent more than in the same period last year. The KSV predicts that 9,200 debt settlement proceedings will be opened by the end of the current year. That corresponds to an increase of 400 cases compared to the previous year.

In the medium term, Götze believes that a sharp rise in private bankruptcies is likely, as inflation has made life much more expensive in recent years. The current figures do indicate that people have a certain level of financial resilience, but it is difficult to say how long this will last. It is also crucial to declare private bankruptcy as quickly as possible before the mountain of debt gets out of control and debt relief becomes very difficult, says Götze.